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ELRCDismissedCause No 113 of 2013· [2015] KEELRC 1184 (KLR)

David Mauki Kithaka v Tharaka Nithi Teachers Sacco Society Limited [2015] KEELRC 1184 (KLR)

Industrial Court (Employment and Labour Relations Court)
24 April 2015
2,152 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~9 min to read original · ~4 min brief

The bottom line

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A Kenyan loans officer lost his unfair termination case because his employer gave him notice, a hearing, and had genuine misconduct reasons for dismissal.

What this practically means

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Executive summary

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The claimant, employed by the respondent society as a loans clerk in 1994 and later promoted to loans officer, was summarily dismissed by letter dated 9.07.2009 on grounds of dishonesty and irregularities in the loans department, with nine specified incidents of irregular loan processing identified and an alleged debt to the society of Kshs.5,063,479.52. He sued for a declaration that the termination was un-procedural, unfair and unlawful, plus damages exceeding Kshs.27 million covering 12 months' salary, responsibility, medical and owner-occupier allowances. The respondent counterclaimed, seeking declarations that the dismissal was lawful, that terminal benefits had been paid per the Retirement Benefits Authority, and a set-off of a decree in Co-operative Tribunal Case No. 36 of 2009. The court framed three issues: unfairness of the termination, the claimant's entitlement to remedies, and the respondent's entitlement to remedies. On the first, the court found the suspension was lawful under the respondent's by-laws, that the claimant had notice of the allegations, attended disciplinary meetings, and wrote an apology admitting malpractices in the loans department, satisfying section 41 of the Employment Act. On validity of reasons, the claimant's own testimony admitted specific misconduct - the unsecured Kshs.1.8 million Nyanchoka loan, receiving Kshs.100,000 from Muthengi Njeru out of loan cash, and failures on the Kenneth M. Njeru loan - satisfying section 43. The termination was therefore held not unfair. The claimant's remedies consequently failed. The respondent's set-off prayer did not arise as no pecuniary award was made, and the Tribunal's findings were conclusive. Judgment was entered for the respondent; the claim was dismissed with costs to the respondent.

Key legal issues

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01

Whether the termination was unfair for want of procedural due process under section 41

Holding

The termination complied with section 41 - the claimant was given notice of the allegations, was suspended per the by-laws, and was given hearings on 13.03.2009, 18.05.2009 and 3.07.2009

Reasoning

The general manager lawfully suspended the claimant under by-law clause 14.2(x). The claimant attended meetings regarding the suspension and wrote an apology admitting malpractices in the loans department, showing he knew the allegations. Cumulatively, the court found notice and hearing as envisaged in section 41 were accorded.

p. 3
02

Whether the respondent had valid reasons for termination under section 43

Holding

Valid and genuine reasons existed, based on the claimant's admitted misconduct in processing irregular loans and a private arrangement with a loan applicant

Reasoning

The claimant admitted the Daniel Oyugi Nyanchoka loan of Kshs.1,800,000 lacked security or guarantors with a misstated repayment period; he admitted receiving Kshs.100,000 from Muthengi Njeru out of loan cash; and he failed his verification duties on the Kenneth M. Njeru loan. His written apology corroborated the misconduct.

p. 3
03

Whether the claimant was entitled to the remedies prayed for

Holding

No - the remedies fall away since unfair termination was not established

Reasoning

The declaratory and monetary reliefs of over Kshs.27 million were premised on a finding of unfair termination. The court found the termination fair and justified, so the remedies evaporate.

p. 4
04

Whether the respondent was entitled to a set-off of the Co-operative Tribunal decree

Holding

No - the set-off does not arise as no pecuniary award was made, and the Tribunal's determination in Case No. 36 of 2009 is conclusive and need not be repeated

Reasoning

The set-off was conditional on a financial award to the claimant, which was not made. The court declined to revisit the Tribunal's conclusive findings, holding it superfluous to repeat what was determined in exercise of competent jurisdiction.

p. 4

Legal principles established

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  • Termination is unfair if the due process prescribed in section 41 of the Employment Act was not followed or if the reason for termination was not genuine as provided in section 43
  • An apology for malpractices in the department under an employee's charge evidences knowledge of the allegations against him
  • A court should not repeat findings conclusively determined by a tribunal exercising competent jurisdiction

Court orders

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  1. 1.Declaration that the respondent's termination of the claimant's employment by the letter dated 9.07.2009 was not unfair
  2. 2.The claimant's claim is dismissed
  3. 3.The claimant to pay the costs of the suit

Authorities

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Legislation

  • Employment Act, 2007section 41
  • Employment Act, 2007section 43
Jurisdiction invoked
Original employment and labour relations jurisdiction under the Employment Act, 2007 (sections 41 and 43)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "David Mauki Kithaka v Tharaka Nithi Teachers Sacco Society Limited [2015] KEELRC 1184 (KLR)", Case Analysis (2015). Cause No 113 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1184/eng@2015-04-24

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.